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IRS Overlooks Noncompliance in Offshore Voluntary Disclosure Program
Source:
accountingtoday.com
- Jun 22, 2016
The Internal Revenue Service is missing out on imposing approximately $21.6 million in penalties on taxpayers who are denied entry or withdraw from its Offshore Voluntary Disclosure Program, according to a new report.
The report, from the Treasury Inspector General for Tax Administration, found the IRS needs to improve its efforts in addressing the noncompliance of taxpayers who are denied access to the OVDP or withdraw from it.
The IRS has offered a series of OVDP initiatives in recent years to allow taxpayers with foreign bank accounts to voluntarily come forward and declare their assets to the IRS to avoid stiff penalties. Increasingly, however, the IRS has already received information about the previously undisclosed bank accounts from foreign financial institutions that are filing reports in accordance with a 2010 law, the Foreign Account Tax Compliance Act, or FATCA, to escape heavy penalties on the banks. When that is the case, the IRS may deny individual taxpayers access to the reduced penalties under the OVDP, perhaps even choosing to prosecute them.
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Category: IRS
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